Drivers with poor credit usually pay for more car insurance. That's because, in the majority of states, car insurance companies can use your credit history when determining your monthly premiums.
According to data from Bankrate, drivers with bad credit (a FICO score below 579) pay an average of 118% more for full coverage than those with excellent credit (a FICO score of 800 or above).
CNBC Select analyzed more than 20 leading auto insurers and chose standouts based on rates for drivers with lower credit scores. Providers were judged on rates, coverage options, availability and more.
For more on how we made our choices, see our methodology.
Best for affordability: Geico
Who's this for? Geico has the cheapest average rates of the companies we reviewed for drivers with bad credit.
Standout benefits: Geico's safe-driving discount can save you up to 22% if you remain accident-free for five years. Putting more than one vehicle on your Geico policy can knock 25% off your premium. There are also rate reductions for federal employees and members of the U.S. military.
Average rate for drivers with poor credit: $3,268 per year
- 16 discounts are available to lower premiums
- Easily purchase and manage policy online
- Policy add-ons can include roadside assistance and mechanical breakdown insurance
- No gap insurance
- Few branches for in-person services
- Ranks below average for customer service and claims on J.D. Power surveys
Best for discounts: Amica
Who's this for? Amica's rates for drivers with poor credit are 30% below the industry average. The insurer offers 18 discounts for auto insurance customers, allowing you to save even more.
Standout benefits: Enjoy a bundling discount of up to 30% if you have life, home or renters insurance with Amica. You can also get a break if you're a homeowner or your car has electronic stability controls or other safety features.
Average rate for drivers with poor credit: $2,861 per year
Amica Auto Insurance
Cost
The best way to estimate your costs is to request a quote
App available
Yes
Policy highlights
Amica offers full and minimum coverage auto insurance, with add-ons accident forgiveness and new car replacement. The Platinum Choice® Auto plan includes new car replacement, credit monitoring and rental coverage with no daily limit.
Terms apply.
Read our Amica auto insurance review
Pros
- High customer satisfaction ratings from J.D. Power
- Bundling home and auto can save you up to 30%
- Drivers in some states are eligible for dividends
Cons
- More higher-than-average rates for most driver types
- Switching from 12-month policies to 6-month
Best for drivers with tickets: First Acceptance
First Acceptance Auto Insurance
Cost
The best way to estimate your costs is to request a quote
Policy highlights
First Acceptance Insurance Company has been underwriting insurance policies since 1969. It specializes in coverage for high-risk motorists, young drivers and those with bad credit.
App available
Yes
Pros
- Competitive rates for high-risk drivers
- SR-22 certificate available
- Flexible payment schedules
Cons
- Limited number of endorsements
- Not available in all states
- High volume of complaints
Who's this for? First Acceptance specializes in high-risk drivers who find it hard to get coverage elsewhere, including drivers with bad credit, speeding tickets, at-fault accidents and DUIs.
Standout benefits: If you've had serious violations and need a certificate of financial responsibility, First Acceptance issues SR-22 forms.
Average rate for drivers with poor credit: Not available
Best for drivers with accidents: Dairyland
Who's this for? Dairyland insures high-risk drivers and could be a good fit if you have an at-fault accident on your driving record.
Standout benefits: The Wisconsin-based company offers types of coverage many other insurers don't, including non-owner coverage, SR-22 certificates and limited coverage for travel in Mexico on all California policies.
Average rate for drivers with poor credit: Not available
- Insures drivers who might otherwise have a hard time getting coverage due to credit scores or accidents
- Can help drivers file an SR-22 certificate with their state, if necessary
- Also offers coverage for motorcycles and off-road vehicles for bundling
- California policies include limited coverage for driving in Mexico
- Not available in all 50 states
- Higher-than-average rates
- Limited number of discounts
Best for infrequent drivers: Nationwide
Who's this for? If you drive less than 13,000 miles a year, the SmartMiles from Nationwide pay-per-mile program could save you 30% over traditional car insurance.
Standout benefits: Nationwide also offers SmartRide, which tracks driving behavior and rewards good habits with up to 40% off.
Average rate for drivers with poor credit: $2,635 per year
- Available in 46 states and Washington, D.C.
- Lowest average premiums for full coverage
- Quotes available online
- High average premium for minimum coverage
- Lower than average scores from J.D. Power's customer satisfaction survey
How your credit score affects your insurance rate
Actuarial studies suggest that how people manage their finances is a good indicator of whether they'll file an insurance claim. So, insurance companies in most areas analyze your credit history to determine your credit-based insurance score. (Only California, Hawaii, Maryland, Massachusetts, Michigan, Nevada, Oregon and Utah restrict insurers from using credit history to assess risk.)
While your credit-based insurance score isn’t the same as your FICO score, it’s calculated using much of the same information. (Si, someone with a high credit score likely has a high insurance score.)
LexisNexis Attract assigns scores between 200 and 997. A score of 770 or above will get the most favorable rates, while a score of 500 or below could result in higher premiums or being denied coverage.
| Insurance score range | Rating |
| 770-977 | Good |
| 626-769 | Average |
| 501-625 | Below average |
| 200-500 | Poor |
To find out your LexisNexis insurance score, you can reach out to LexisNexis and request your Consumer Disclosure Report.
FICO also has an algorithm to calculate insurance scores. It considers five factors, each assigned a different weight.
- Credit history: 40%
- Current level of debt: 30%
- Length of credit history: 15%
- New credit: 10%
- Credit mix: 5%
FICO doesn't make its insurance scores available to consumers, but you can ask a current or prospective insurer to share yours.
How to improve your credit score
Your credit history typically accounts for 40% of your insurance score. The easiest way to improve your insurance score is to improve your credit.
Make on-time payments in full. Payment history is the largest segment of your credit score. A strong track record of on-time payments can boost your credit. (You'll also avoid late fees and interest charges.)
Request higher credit limits. If you raise your credit limit without spending more, it'll lower your credit utilization ratio
Hold off on new lines of credit. Applying for a loan or credit card could require a hard credit inquiry, which can ding your credit score. If you're approved, it will also lower the average age of your accounts.
Check your credit report for errors. Mistakes in credit reports are common and, while most are benign, some can damage your credit. Because the main credit-reporting agencies — Experian, Equifax and TransUnion — collect information independently, you should review your report with all three.
Car insurance credit score FAQs
Do car insurance companies check your credit score?
Car insurance companies in most states consider your credit-based insurance score when deciding on approvals and rates, along with your driving record, age, location, previous claims and other factors.
What states don't allow insurers to use credit scores?
California, Hawaii, Maryland, Massachusetts, Michigan, Nevada, Oregon and Utah prohibit or restrict insurance companies' use of credit in calculating rates.
What credit score do you need for car insurance?
While there's no set minimum score to get car insurance, you'll pay more if you have a lower score. Drivers with a credit score of 580 or below pay about 115% more for full coverage than the average driver with a credit score of 800 or above, according to Bankrate.
Does applying for car insurance hurt my credit score?
While insurance companies check your credit during the quote process, it's a soft inquiry that doesn't appear on your credit report or affect your credit score.
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Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed financial decisions. Every car insurance review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of insurance products. To research the best insurance companies, we compiled over 100 data points on more than a dozen insurance companies. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics. See our methodology for more information on how we choose the best insurance companies.
Our methodology
To determine the best insurance companies, CNBC Select analyzed dozens of insurance companies and compared them based on various factors, including cost, coverage, availability, ease of use and customer satisfaction
While narrowing down the best car insurance companies, we used a sample premium from Bankrate for a driver with a 580 credit score and incorporated customer satisfaction ratings from J.D. Power, the National Association of Insurance Commissioners and the Better Business Bureau.
We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.
From there, we sorted our recommendations by the best for affordability, for discounts, for drivers with speeding tickets, for drivers with at-fault accidents and for infrequent drivers.
Premiums and policy structures cited for auto insurance companies may fluctuate with company policy.
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Correction: LexisNexis Attract is used to generate the credit-based insurance scores (CBIS) used by auto insurance companies. An earlier version of this story misstated which tool is utilized
